High transaction costs will tend to
A) reduce the number of mutually beneficial exchanges that occur.
B) allow easier specialization according to the law of comparative advantage.
C) increase the value created by exchanges in an economy.
D) increase the number of mutually beneficial exchanges that occur.

Question

Quizplus · Accepted Answer

High transaction costs make it more difficult and expensive for parties to engage in exchanges, thus reducing the number of mutually beneficial exchanges that occur.

High Transaction Costs Will Tend to